Why Real Estate Is One of the Best Ways to Make Money....
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After a decade of saving and investing, I think real estate is one of the best ways to make money and build wealth. Here is why.
There are many ways to turn a profit with real estate.
When you buy a stock, the only way you can make money is if the stock appreciates in value, and you sell it at the good time.
With real estate you can make money in many ways, I can name those 12 off the top of my head, and there are many more.
Rental income. That one is the main source of profit investors are going for when buying a rental , and doesn’t need an explanation.
Buying low. You turn an instant profit if you manage to buy a property for under market value. Think foreclosures, quick sales, and awesome negotiation skills.
Selling high . You can make extra money if you stage the property to attract buyers over market value. With stocks, you always buy and sell at market value. With real estate, you can try to beat the market.
Increasing equity . If you take a mortgage to finance a rental, you are increasing your equity with every mortgage payment. I put down 25% on my last rental and with mortgage repayments am around 33% equity at the moment, those 8% of the property value were paid by rents and are increasing my net worth every month.
Leverage increases returns. If you put 20% down on a property, you will still receive rental income based on 100% of the property value, making it a great return for your 20%. Say your property is worth N100,000 and you charge N750 in rent with N500 in mortgage, taxes and fees. You have a N250 profit on N20,000 down. That is N3,000 a year, or a cool 15% return on your deposit. Good luck trying to get an almost guaranteed 15% on stocks.
Renting smaller units. I rent three rooms by the room, to three tenants. I can charge more than if one family was renting the whole place. You can divide your family house into a duplex or a triplex and increase the rent.
Tax benefits on improvements. You can also deduce the cost of the improvements from the rental income, while the added value to the property is yours to keep.
Profit from extra cash flow on a refinance. If you are able to refinance the property to lower your mortgage bill payments while the rent stays the same, you are generating more cash flow every month. You can build a cushion for maintenance, save up for a deposit on a new rental, or have more passive income to live off.
How you profit from real estate depends on YOU. When you buy a stock, you never know, for as much as you study the company, if its CEO isn’t about to leave and the next one will run the company to the ground, if there is a merger with a less profitable company in the pipeline, or if an earthquake will destroy the production plant in China. Your real estate investment will be a result of your own efforts to renovate a place, promote it, screen a proper tenant, and keep it up over the years. And real estate is tangible. When all the markets tank, you are trying to hold to your losing positions in hopes they will go up in a few months, or hurrying to sell at a loss before it gets worse. Real estate will bring you a monthly rent to cover the mortgage, even if you have negative equity. And in periods of economic turmoil, when people lose their houses to foreclosure or first time buyers are denied mortgages by the banks, you will have more potential renters than ever. When things go back to normal, home prices will increase and you can make a nice exit, sit it out until the next crisis, and go back in the game to buy low. Don’t want to time the market? Just buy. Now is as good a time as any, for all the reasons mentioned above.
... You can contact me for more business motivation and presentation our company has an ongoing real estate business you could invest into mail me for more details akinremiv@gmail.com or you whatsapp me on +2348062223441
You will be glade you did. Thank For always checking on our site and our post........
After a decade of saving and investing, I think real estate is one of the best ways to make money and build wealth. Here is why.
There are many ways to turn a profit with real estate.
When you buy a stock, the only way you can make money is if the stock appreciates in value, and you sell it at the good time.
With real estate you can make money in many ways, I can name those 12 off the top of my head, and there are many more.
Rental income. That one is the main source of profit investors are going for when buying a rental , and doesn’t need an explanation.
Buying low. You turn an instant profit if you manage to buy a property for under market value. Think foreclosures, quick sales, and awesome negotiation skills.
Selling high . You can make extra money if you stage the property to attract buyers over market value. With stocks, you always buy and sell at market value. With real estate, you can try to beat the market.
Increasing equity . If you take a mortgage to finance a rental, you are increasing your equity with every mortgage payment. I put down 25% on my last rental and with mortgage repayments am around 33% equity at the moment, those 8% of the property value were paid by rents and are increasing my net worth every month.
Leverage increases returns. If you put 20% down on a property, you will still receive rental income based on 100% of the property value, making it a great return for your 20%. Say your property is worth N100,000 and you charge N750 in rent with N500 in mortgage, taxes and fees. You have a N250 profit on N20,000 down. That is N3,000 a year, or a cool 15% return on your deposit. Good luck trying to get an almost guaranteed 15% on stocks.
Renting smaller units. I rent three rooms by the room, to three tenants. I can charge more than if one family was renting the whole place. You can divide your family house into a duplex or a triplex and increase the rent.
Tax benefits on improvements. You can also deduce the cost of the improvements from the rental income, while the added value to the property is yours to keep.
Profit from extra cash flow on a refinance. If you are able to refinance the property to lower your mortgage bill payments while the rent stays the same, you are generating more cash flow every month. You can build a cushion for maintenance, save up for a deposit on a new rental, or have more passive income to live off.
There is less risk in real estate leverage than in stock leverage
Stocks are volatile. Penny stocks and currencies even more so. Some trading companies will allow you to trade on leverage.
How you profit from real estate depends on YOU. When you buy a stock, you never know, for as much as you study the company, if its CEO isn’t about to leave and the next one will run the company to the ground, if there is a merger with a less profitable company in the pipeline, or if an earthquake will destroy the production plant in China. Your real estate investment will be a result of your own efforts to renovate a place, promote it, screen a proper tenant, and keep it up over the years. And real estate is tangible. When all the markets tank, you are trying to hold to your losing positions in hopes they will go up in a few months, or hurrying to sell at a loss before it gets worse. Real estate will bring you a monthly rent to cover the mortgage, even if you have negative equity. And in periods of economic turmoil, when people lose their houses to foreclosure or first time buyers are denied mortgages by the banks, you will have more potential renters than ever. When things go back to normal, home prices will increase and you can make a nice exit, sit it out until the next crisis, and go back in the game to buy low. Don’t want to time the market? Just buy. Now is as good a time as any, for all the reasons mentioned above.
... You can contact me for more business motivation and presentation our company has an ongoing real estate business you could invest into mail me for more details akinremiv@gmail.com or you whatsapp me on +2348062223441
You will be glade you did. Thank For always checking on our site and our post........
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